The Daily bulletin. [volume] (Honolulu [Hawaii]) 1882-1895, 1887-04-15
Chr 9ailg 8nlletin.
FRIDAY. APRIL 10. 1887.
PAYMENT BY CREoUE


all persons should make themselves
perfectly acquainted with the law as
relating to the subject, and the
customary precautions to prevent
fraud. 1t is only short time ago
that q metropolitan modistc sued
for balance of account under the
following circumstances: -. The
dressmaker wrote to her customer
in the country, requesting a cheque
to be sent in the course OF few
days. The request was complied
with. A cheque for very consider
able sum, approaching f1OO, was
sent, as requested, by post. 1t was,
unfortunately, stolen in transit, and,
being an open one, was at once
cashed by the thief. The lady who
forwarded it according to request
naturally objected to pay a second
time, and the trader who had not
received it refused to regard the ac-
count as having been settled. An
action at law to recover the amount
was the result, when it was decided
that as the B chequc had been
in accordance with the request
of the vendor, the loss must
fall upon her. 1t is hardly salts
factory to reflect on the very slight
amount of knowledge respecting the
usages of bankers in regard to
cheques that would have prevented,
not only the cashing of the cheque,
but the heavy legal expenses and
personal Inconvenience that accom-
panied the trial. Cheques, it should
be borne in mind, are of several
distinct kinds; the most simple is a
direction to the banker to pay to q
person named, say, "Mr. John
Smith, or bearer" certain sum
named. This cheque the bank is
bound to pay to any person who
presents it, so that if it is lost, and
there is not time or opportunity to
apprise the bank of the loss before
the cheque is presented, it must be
paid. One of the most useful pre-
cautions that can be used with re-
gard to cheques, is making them
payable not to "Mr. John Smith or
bearer" but to "NIr. Smith or
ORDER This necessitates Mr..
Smith writing his name across the
back, or in commercial phrase en-
dorslng it. Order cheques are much
more advantageous than those pay
able to bearer. The receiver has to
sign his name on the back, so that
the cheque becomes evidence that
he has received the amount; but if
the cheque is still further protected
by being "crossed," the security
becomes much greater. Crossing q
cheque is accomplished by the SIM
pie process of drawing two lines
across it and writing between them
either the name of any particular
bank, or the words "and Co."
which ensures, in the first case, that
the cheque must be presented for
payment by the particular bank
whose name is written across; or,
in the second, by any bank, as a
crossed cheque is never paid TO q
private individual. Had the lady
who was defendant in the action we
have alluded to simply taken the
precaution of scratching these two
lines and the cabalistic figures "and
Co." across the cheque before post
ing it, there would have been no
loss nor lawsuit, as the thief could
not have got any other person to
cash it, and no bank would have re-
ceived it except from one of their
known customers.
In sending cheques by post they
should invariably be crossed either
to the banker of the person to whom
they are sent, or simply "and Co., >"
when they can be paid through any
banker. Another mode which en-
sures their not being paid to anyone
but the party to whom they are
sent, and in whose favour they are
drawn, is to write across each one
the words "Not negotiable" There
are some other precautions respect
ing cheques which it is well to bear
in mind. If cheque-books are left
about carelessly any dishonest per-
son can abstract one or two, and,
by filling them up with fictitious
names, obtain money from unsus-
pecting persons. They should,
therefore, be kept under lock and
key, and not left lying about in
places where they can be purloined
for unworthy purposes. 1t is often
desirable to send chcque by post
or messenger for an uncertain sum,
which cannot be determined at the
time it is signed. This, under
ordinary circumstances might be a
dangerous proceeding. The person
into whose hands it passed might fill
it up for very much larger sum
than intended by the drawer, which
sum the bank would pay, and the
drawer of the chequc would lose.
This may be prevented by writing
across such an open cheque the limit
which the bank is not to exceed. II
the words "under fl0" is written
on the cheque, no larger sum would
be paid. A cheque must be dated
on the day it is drawn, and not on
any past or future day. The writing
of the amount, both in letters and
figures, should be done to the eX.
treme left of spaces in which the